Cape Town - Former City of Cape Town employee Paul Hatting made his first appearance in the Bellville Magistrate’s Court this week on charges of fraud, corruption and money laundering.
Hatting is accused of tender fraud amounting to about R70 million after allegedly awarding contracts to his company, and at least two other companies, between 2008 and 2014.
National Prosecuting Authority (NPA) spokesperson Eric Ntabazalila said the matter was postponed for Hatting to consult with his lawyer.
The State alleges that Hattingh, who was a member of the Bid Evaluation Committee (BEC), hid his conflict of interest and recommended that a R49.9m contact for supply and delivery of refuse black bags be awarded to C’Est Gyms.
“In return, the company awarded the contract and paid R10.4m into the bank account of his company, of which he was a sole director and had signing powers. He then used the money for his benefit.
“Hatting was employed as an Administrative Officer 2: Supply Chain Management at their Ndabeni store since March 1, 2002. He was a storekeeper and technical advisor and knew who the City of Cape Town’s service providers were. On April 18, 2008, he bought Cosmic Gold Trading 517 from his son’s mother. This was a shelf company registered for general trading in all aspects.
“The State alleges that Hatting, together with other persons unknown to the State, conspired, agreed and decided to embark on an initiative to influence the tender process of refuse bags or ordering of refuse bags by the City of Cape Town from C’Est Gyms and that C’Est Gyms would regularly pay money into his company’s bank account. C’Est Gyms was registered as a close corporation with Ms Shu Wei Lu and Ms Irene September as members.
“September did not actively participate in the running of the company; Lu conducted the day-to-day operation of the business. The company was a registered service provider to the City of Cape Town on January 4, 2006,” said Ntabazalila.
Members of the BEC are required to sign a Conflict-of-Interest Declaration form in which the member declares any conflict of interest s/he may have or has in respect of a contract being decided on, Ntabazalila added. Where a conflict of interest may arise, the member is required to recuse him/herself for the BEC to determine whether such conflict has any impact on the tender process.
“The BEC recommended on September 16, 2008, that the contract for the supply and delivery of refuse bags be awarded for two years from November 1, 2008 to October 31, 2010, to four companies including C’Est Gyms CC,” said Ntabazalila.
The State further alleges that Hatting benefited from these misrepresentations by more than R49m, to the actual or potential prejudice of the City of Cape Town and/or other tenders and/or the public.
According to the State, he used his benefits for personal expenses as there were inter alia 87 transactions to the value of more than R800 000, under the name of PM Hattingh, 39 cash withdrawals to the value of more than R2.2m, and payments made to Mercedes Benz and McCarthy Toyota.
Funds were also transferred to companies he had a relationship with, such as six transactions to Cosmic Gold 532 to the value of R216 000, 19 transactions to Park Boulevard Traders to the value of more than R2m, and five transactions to Ttanc Trading to the value of R224 000. This constituted money laundering.
The case has been postponed to June 26.
Cape Times